East-west Canada Economic Gap Growing


by Anthony Fontanelle - Date: 2007-09-16 - Word Count: 404 Share This!

A recent study conducted to determine how major Canadian cities are faring shows that the gap between the Eastern and Western cities is expanding. Western cities like Saskatoon and Calgary are just two of the fastest growing cities in Canada. The Conference Board recently reported that seven of the fastest growing Canadian cities are in the West.

While Saskatoon and Calgary are on the track of recording the highest GDP growth this year, traditional Eastern powerhouses like Toronto are operating below their potential. The reason for this is the cut made into the manufacturing sector based in Ontario and Quebec.

The United States auto industry's current plight also has a negative effect on Eastern provinces. With the demand for large cars shrinking and American automakers' assembly facilities in Canada manufacturing large vehicles, less vehicles are produced thus jobs are cut. For the last two years, the United States' Big Three, General Motors, Ford and Chrysler has cut down thousands of jobs on the Eastern Canadian provinces. Even with sales in Canada increasing along with auto parts for Canadian consumers like fuel injectors Canada, the trend still continues.

While eastern cities suffer from workforce reduction, the West has benefited from the growth of the oil and gas sector. It is interesting to note that it is the increase in the price of petroleum products which have propelled the economy of the Western provinces. It is also the reason why auto buyers are buying more from Japanese automakers. The result is that the United States' Big Three recorded loss and reduce their production and employees which led to the dismal economy of Eastern Canadian provinces.

The economy of Asian countries especially China also plays a major role in the growing economy of Western cities. The mining, agriculture, and processing industry in the West is receiving more orders from China. Uranium in northern Saskatchewan and coal in British Columbia and Alberta fetches record prices. These industries offset the dismal forestry industry.

Shipments going to Japan and other countries pass through the ports of Vancouver and other Western provinces. This alone gives much revenue for the West. Products shipped to other countries across the globe include coal, wheat, barley, potash, and chemicals.

In the study, thirteen large cities have been studied by the Conference Board. Of the thirteen cities, the top seven in terms of projected GDP growth for this year are located in the West while the lower six are from the East.

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